Hexaware Technologies - On a song, raise TP further to Rs 95 ::Emkay

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Hexaware Technologies

On a song, raise TP further to Rs 95

ACCUMULATE

CMP: Rs82                                        Target Price: Rs95

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n     June’11 results vindicate our positive thesis with revenues at US$ 75 mn(+6.2% QoQ) and op mgns improving by ~100 bps QoQ to 15.3% despite wage increments and strong net hiring

n     Profits at Rs 603 mn (+12% QoQ) beat  estimates driven by better margins aided further by higher than expected hedging gains and lower taxes

n     CY11 revenue outlook raised to 30% YoY growth to US$ 302 mn( V/s US$ 295 mn earlier). Sep’11 quarter revenue guidance is strong at 4.3-5.6% QoQ increase

n     Raise CY11/12E earnings by ~14%/11% to Rs 7.5/8.2 driven by higher margin assumptions (refer section below). Retain ACCUMULATE with a revised TP of Rs 95 (V/s Rs 80 earlier)